IMF urges German banking sector to accelerate restructuring

BERLIN, May 17 (Reuters) - The International Monetary Fund on Friday urged Germany’s banking sector to pick up the pace on restructuring plans to make lenders more profitable and reduce risks.

“Restructuring must be accelerated in the banking sector through further consolidation, cost-cutting, and continued development of fee-based income,” the IMF said in a report on Germany.

It added: “In the life insurance sector, low interest rates challenge the sector’s resilience, and the replacement of conventional guaranteed return products with other types of products needs to proceed faster.”

The IMF also said Germany’s short-term growth outlook remained good but Europe’s largest economy faced major risks including a worsening of trade tensions, a further China slowdown, a disorderly Brexit and more trouble in the euro zone. (Reporting by Michelle Martin Editing by Tassilo Hummel)